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McDermott Strikes Twin Deals - Analyst Blog

An affiliate of engineering and construction firm
McDermott International Inc.
(
MDR
) received contracts for two projects of Saudi Arabian Oil Company
- Saudi Aramco. The projects are in the Karan, Safaniya and Zuluf
fields in the Arabian Gulf.

Although the value of these contracts will be included in
McDermott's second quarter 2012 backlog, the company did not
divulge the financial terms of the deal.

For the first project - Karan-45 - McDermott will extend services
that include fabrication of a new wellhead platform, auxiliary
platform, jacket and link bridge. The Houston, Texas-based company
will work on subsea installation of a 20-inch flowline and a 15-kV
composite power and fiber optic wire.

Project management, engineering and procurement works - expected to
be completed in the first quarter 2014 - will be developed at the
facility of McDermott in Al-Khobar, Saudi Arabia.

The second job - slated to be over by the first quarter of 2013 -
involves the procurement of flexible flowlines along with the
fabrication, transportation and installation of pipelines and
subsea tie-ins.

McDermott management believes that know-how and experience gained
from the previous contract in the Karan field will help the company
in executing the current deal with perfection and on time.

McDermott, which currently retains a Zacks #3 Rank (short-term Hold
rating), primarily serves the worldwide offshore oil and gas field
developments, including front-end design and detailed engineering,
fabrication and installation of offshore drilling and production
facilities, as well as installation of marine pipelines and subsea
production systems.

Given its geographic footprint in high-growth regions, technology
leadership and efficient execution skills, the company is poised to
benefit from strong industry fundamentals for offshore construction
activities through 2012 and beyond.

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